If a company is concerned that its state will follow in the footsteps of Massachusetts, it would be wise to understand its state`s handling of e-mail correspondence in the case law, as well as terms such as the essential terms of an agreement and the Parol rule of evidence. It may even be possible to predict the most likely interpretation of text messages from state to state based on these predictive markers and the analogy with email communication. In one way or another, lawyers and companies are best placed to prepare for the legal importance of text messages in negotiations and the formulation of binding contracts. In New Jersey, agreements for business brokers must be concluded in a signed letter (status of fraud). In this case, the business broker and seller communicated via a business sale and the broker`s commission via SMS. They agreed and the seller resigned. The real estate agent filed a complaint. St. John`s Holdings was in the process of purchasing a property of two electronics in Danvers, MA, and received a text message from Two Electronics containing a letter of intent (LOI). The SMS contained the terms of the contract and included the names of the brokers who made the transaction. According to the SMS instructions, St.
John`s Holdings signed the LOI and cut the purchase cheque for the property. However, Deux Electronics then sold the property to a third party and refused to comply with the MOU. Therefore, Massachusetts businesses should be prepared that, if the requirements of the Fraud Act are met, a text message has greater legal reach and should be managed with care, such as an e-mail or other similar signed communications. Despite the changing legal environment, there are still practical steps that can be taken even if the company is not based in Massachusetts or California. California`s fraud law explicitly excludes text messages and similar forms of e-mail from writings that can be used as evidence of an agreement. Since this provision has been developed specifically with respect to the Fraud Act, the courts will determine that a discussion or negotiation through text messages is not sufficient evidence of a valid agreement for a long-term contract or real estate transaction. It is therefore important that important agreements are reached to ensure their terms. This judgment specifies that text messages can be considered legally enforceable as long as they meet the requirements for a bilateral offer, counterparty, capacity and acceptance contract.
The Massachusetts Regional Court`s ruling also indicated that these contracts could replace the written contracts on paper and ink, imposed by the Fraud Act, which is enforced by many states. Text messages can also be used to negotiate and accept bilateral agreements. Bilateral contracts accepted by SMS, as in writing, have an offer, consideration, contractual capacity and acceptance. In 2016, St. John`s Holdings, LLC vs. Two Electronics, LLC created the precedent for text messages as valid legal documents.